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State House panel approves Medicaid expansion

Hundreds of thousands of more low-income adults in Michigan would become eligible for government-funded health insurance under legislation approved Wednesday by a divided legislative committee, setting the stage for a crucial vote in the Republican-led House.

AP Wire

Lansing

Jun 13, 2013

The 9-5 vote came after months of talks in the GOP-controlled Legislature over expanding Medicaid eligibility. Republican Gov. Rick Snyder is pushing hard for the expansion before legislators break for the summer at the end of next week.

If the Senate is to approve the bill next week, the House has to act Thursday under legislative rules.

Rep. Mike Shirkey, a Clark Lake Republican who chairs the committee that OK'd the expansion, said he was staunchly against the idea when Snyder proposed it in February. But he was among four Republicans on the panel to join all five Democrats in backing expansion starting in 2014. Five Republicans opposed it.

"I evaluated the downsides, what would actually happen to the state if we did nothing," Shirkey told reporters. "Things like not being able to address this growing problem of uncompensated care. Things like Michigan being a huge donor state in terms of the new taxes associated with the Affordable Care Act. Those are the kind of things that I said, 'You know what. We cannot afford to not step up and address those.'"

Medicaid covers roughly one in five Michigan residents — mainly low-income children, pregnant women and the disabled along with some poorer working adults.

Under the federal health care overhaul, states can expand Medicaid to adults making up to 133 percent of the poverty level, or about $15,300 for an individual. The U.S. government is offering to cover the entire cost initially and 90 percent down the line.

The bill includes GOP-written requirements that new enrollees pay some of their medical expenses after being on the program for six months and pick up more costs after getting Medicaid for four years. They could lower their costs by not smoking, for instance, or adhering to other healthy behaviors.

The newly eligible also would no longer be covered if savings from the expansion do not cover the state's costs in the future.

"This is our opportunity to demonstrate not just to the citizens of Michigan but to the people of the nation that you can take tough circumstances that have been provided to you and work within them to make them attractive," Shirkey said.

But Wes Nakagiri, founder of tea party group RetakeOurGov in Hartland, told committee members that while financial arguments for expansion sound compelling, they are incomplete.

"Nothing is free. Government programs aren't free," he said.

Nakagiri said he took a day off work so he could in good conscience know he did everything he could to persuade lawmakers to oppose the government expansion.

"We see it as morally wrong to saddle future generations with debt that our generation is incurring," he said.

The federal government would have to sign off for Michigan to proceed with its plan. Shirkey said U.S. Health and Human Services officials have reacted favorably to most of what Republicans want to do, though no promises have been made in regards to how the GOP wants to handle nondisabled adults after they receive four years of insurance.

Those adults ages 21 to 64 and making between 100 and 133 percent of the poverty line would have two options after four years under the House bill: buy government-subsidized insurance through a new health insurance market or stay on Medicaid by paying more out-of-pocket costs.

"There have been no other states asking for the breadth and depth of waiver requests that we're making. None," Shirkey said.

Supporters say offering health insurance to more poor people will make them healthier and minimize their expensive trips to the emergency room, saving money throughout the health care system. Backers include business groups, hospitals, nurses and insurers.

Working parents in Michigan currently qualify for Medicaid if they earn up to about half the poverty line, $11,800 for a family of four. Nondisabled adults without children who make less than 35 percent of the poverty level, or $4,000 for an individual, also get Medicaid — although the program generally is closed to new participants.

An estimated 320,000 state residents — many of them adults without children — could be added to Medicaid in 2014 and 470,000 by 2021, cutting Michigan's uninsured by nearly half. Uninsured residents with higher incomes will be covered by a federal exchange offering taxpayer-subsidized private plans.

State Department of Community Health Director Jim Haveman touted the state's Medicaid program, which is run primarily through HMOs so recipients are assigned to primary care physicians.

"This program is not broken. It's effective and it makes a difference to the citizens of this state," he said.